Many accounting discussions revolve around being more accurate, increasing speed and streamlining data entry. While useful, those topics miss the burning question. At this year’s convention of QuickBooks® partners and customers, Scott Cook, founder of Intuit®, addressed a select group of accounting influencers. His words of wisdom came in the form of a question, “How can we do better?”
To answer this question, you have to go deeper than just producing more of the same – only faster. I got an inkling of Scott’s meaning when he seized upon the answer given by a QuickBooks partner. The partner wanted better financial reporting, not just prettier financial statements.
“You know,” said Scott, “I’ve consulted several CEOs – people who are trained to read financial statements – and still they want you to paint them a picture, not produce columns of numbers.” He paused for a moment and then said, “Small businesses are no different.”
Arguably, the deeper purpose of accounting is to communicate an organization’s economic activities in a way that leads to better decision making. Sure, being timely and accurate are big parts of delivering value, but so is delivering our message in a way that can be understood by our audience. Our job isn’t finished when we produce a set of financial statements. We have to go one step further and make sure that the message is received in a way that it can be acted upon.
Another partner wanted a cash flow forecast that built on the activities of the recent past and projected them into the near future. She said, “The question that many of my clients ask me is, ‘Can I make payroll this week?’”
Often, financial reports boil down to one question in the mind of the reader. My clients aren’t scanning the financial results, looking for anomalies and interesting trends. That’s my job as their accountant. They are looking for the answer to their burning question, “Do I have enough money to pay my suppliers, get through to the next quarter, fulfill my contractual commitments, buy the new equipment, fix the building or make payroll?” And, charities are no different. They want to know if enough funds have been raised to run their programs and pay their staff.
So, if I don’t know my clients’ burning question, I can’t do my job as their accountant. However, if I want to go one step further and delight my client, I won’t make them hunt for that answer … I will paint them a picture.